The UK must fundamentally rethink its approach to the Middle East and potentially distance itself from the “mercurial and unpredictable” leadership of Donald Trump, a major report has concluded.

Former cabinet ministers, senior foreign policy advisers and diplomats warned the Foreign Office against relying too heavily on the US president and urged the UK to completely redraw its approach to the region.

Calling on Britain to forge new alliances in the Gulf region, the Lords international relations select committee described Britain’s policy in Syria as being in “confusion and disarray” and suggested influence with Iran and Saudi Arabia had dwindled.

The report concluded Boris Johnson, the foreign secretary, should support the Iran nuclear deal, loathed by the Trump White House, and seriously consider recognising Palestine as a state in order to boost the Middle East peace process.

“The mercurial and unpredictable nature of policymaking by President Trump has made it challenging for the UK government to influence US foreign policy so far, a challenge that is not likely to ease,” the committee said.

The group is chaired by the former Conservative cabinet minister Lord Howell and includes former foreign policy advisers to William Hague and Gordon Brown, the former UK ambassador to the UN Lord Hannay, and the former Labour defence secretary Lord Reid.

“In a world less automatically dominated by the US underpinning security in the region, it is no longer right to have a stance at every stage of ‘if we just get on with the US everything will be alright’,” Howell said. He described the US as “the wild card”, and said: “We really have to think for ourselves.”

He added: “The Middle East has changed and UK policy in the region must respond to that. As the UK prepares to leave the EU, and we have a new and uncertain American policy in the region, we cannot assume our strategies of the past will suffice.

“We need a new UK Middle East strategy and set of policies that reflect the new reality in the region. We can no longer assume America will set the tone for the west’s relationship with the Middle East and the UK must give serious thought to how our own approach will need to change.

“From inward investment to the UK, the impact of refugees from the region and our continuing reliance on gas and oil exports, our interests will continue to be intertwined with those of the region and the government must ensure it has the right plan for our relationship with it.”

Overall, the committee called for “a new mindset in policy circles” that questions the assumptions that have guided UK policy for the last century, including the power of external, rather than internal, actors to dominate the region.

The findings will be seen as a warning to the foreign secretary, who has devoted considerable personal energy to the Middle East and set great store by his relationship with the Trump administration.

The committee said the UK response to the Arab spring had been “muddled”, sometimes supporting hereditary authoritarian family rulers, at other times siding with revolutionary movements fighting the old regimes.

The report called for the suspension of some arms sales if the Saudis were unable to be more transparent about their use of UK weaponry. It also urged a complete review by government of how it makes decisions on arms export licences.

The report also suggested the UK more broadly must “go considerably further to improve transparency and accountability about its relationship with repressive regimes in the Gulf”.

“On key issues of public and parliamentary concern, the government has not been able to demonstrate that private diplomacy has been able to influence directions of policy,” it added.

Bomb-damaged buildings in Yemen. The report said Britain had been over-reliant on Saudi assurances over how it is using UK arms in the war there. Photograph: Ghaith Abdul-Ahad for the Guardian

Referring to an unpublished government strategy for the Gulf, the report said: “The UK has not taken the opportunity to set out a clear assessment of its objectives in the region to which it can be held to account.”

The committee was sharply critical of the role of the new US administration, saying it had the potential to destabilise the region further.

The report said: “The mercurial and unpredictable nature of policymaking by President Trump has made it challenging for the UK government to influence US foreign policy so far, a challenge that is not likely to ease.”

The committee also said Johnson’s position on whether President Assad could have a role in a future Syrian government was “confused”, saying: “He set out a position that oscillated in the course of the one evidence session”.

“There are no good options in Syria,” the report concluded, adding that “the removal of Assad as a prerequisite of any settlement is not going to be achievable with the current means and policy”.

In the case of Iran, the committee suggested the UK and Europe should ease banking regulations to open up new sources of finance for Tehran, even if Washington will not follow suit. It claimed Trump does not have the international support to tear up the existing Iran deal, but said “there is a dangerous escalatory logic to the US approach”.

The criticisms will sting the Foreign Office. Johnson has invested considerable energy in trying to influence US thinking, and claims the refusal to challenge Trump in public has led to changes in US thinking including towards Nato, Syria, Russia and even Iran.

A Foreign Office spokesman said: “The Middle East remains a foreign policy priority and the UK will continue to work with international partners to achieve security and prosperity.”